mis_8k1218ex101.htm


    Exhibit
10.1

     

     

    


    AMP
Rail Services Canada Share and Debt Purchase Agreement

    


    This Share and Debt Purchase Agreement
(the “Agreement”) is
made and entered into this 18th day of December, 2009, by and among 4107730
Canada Inc., a Canadian corporation doing business as Novatech Inc. (the “Purchaser”), and American
Motive Power, Inc., a Nevada corporation, referred to herein as “Vendor” and, together with the
Purchaser, the “Parties”).

    


    Recitals:

    


    A.           AMP
Rail Services Canada, ULC, an Alberta unlimited liability corporation (the
“Company”) is engaged in
the locomotive service business including, without limitation, the repair and
remanufacture of locomotives and related equipment (the “Business”).

     

    B.           Vendor
owns one (1) common share (the “Purchased Share”) in the capital of the
Company, which Purchased Share represents all of the issued and outstanding
common shares of the Company.

    


    C.           Vendor
owns U.S.$1,875,000 of debt of the Company (the “Intercompany Debt”) evidenced
by the senior demand promissory note attached hereto as Exhibit “A” (the “AMP Note”).

     

    D.           All
other liabilities and debts of the Company to the Vendor and parties related (as
such term is defined by the Income Tax Act (Canada)) to
Vendor, other than those incurred in the ordinary course of business since
November 13, 2008, have been written off and cancelled.

     

    E.           Vendor
desires to sell the Purchased Share to Purchaser and Purchaser desires to
purchase the Purchased Share from Vendor, at the price and subject to the terms
and conditions set forth in this Agreement.

     

    F.           Vendor
desires to sell the Intercompany Debt as evidenced by the AMP Note, which for
the purposes of this Agreement is a current liability of the Company
(collectively, the “Purchased Debt”) to Purchaser and
Purchaser desires to purchase the Debt from Vendor, at the price and subject to
the terms and conditions set forth in this Agreement.

    


    NOW THEREFORE, in
consideration of the promises hereinafter made, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
recital provisions above are incorporated into the body of this Agreement as if
fully set forth therein, and the parties agree as follows:

    


     

    Article
I.

    Purchase
and Sale of Purchased Share and Purchased Debt

    


    1.01           Purchase and Sale of Purchased Share
and Purchased
Debt.  On and subject to the terms and conditions set forth
herein, Vendor agrees to sell, assign, transfer and deliver to Purchaser, and
Purchaser agrees to purchase from Vendor the Purchased Share and
the


    
      
         


      

      
        Page 1 of
26

        
          

        

      

      
         


      

    


    Purchased
Debt, free and clear of any and all liens, claims, pledges, hypothecations,
mortgages, deeds of trust, security interests, leases, charges, options, rights
of first refusal, easements, servitudes encumbrances or other restrictions of
any nature whatsoever (collectively, “Liens”) .

     

    1.02           The Closing.  The
closing of the transactions contemplated by this Agreement (the “Closing”) shall take place by
wire transfer and exchange of facsimile signature pages on December __, 2009 (the “Closing Date”), or such other
date as the Vendor and the Purchaser may agree to in writing. Subject to
satisfaction or waiver by the relevant party of the conditions of closing, at
the Closing, the Vendor will sell, assign and transfer the Purchased Share and
the Purchased Debt to the Purchaser, and in consideration for such sale,
assignment and transfer the Purchaser will pay or satisfy the Purchase Price in
accordance with Section 2.01.

    


     

    Article
II.

    Payment
of Consideration

    


    2.01           Purchase
Price.  Subject to any post-Closing adjustment made pursuant to
Section 2.05, the purchase price payable by the Purchaser to the Vendor
for:

     

    (a)           the
Purchased Share, shall be One United States Dollar (US$1.00) (the “Purchased Share Purchase
Price”); and

     

    (b)           the
Purchased Debt, shall be One Million Five Hundred Thousand United States Dollars
(US$1,500,000.00) (the “Debt
Purchase Price”), collectively with the Purchased Share Purchase Price,
the “Purchase
Price”).

     

    2.02                 Deposit.  The Vendor
acknowledges receipt from the Purchaser of a deposit in the amount of US$50,000
(the “Deposit”).  The
Deposit will be applied on Closing in satisfaction of an equivalent amount of
the Purchase Price.

     

    2.03                 Payment of Purchase
Price.  On the Closing Date, Purchaser shall pay the Purchase
Price as follows:

     

    (a)           Cash at Closing.  A
total of One Million One Hundred Thousand one United States Dollars
(US$1,100,001.00) (the “Closing
Payment”), as follows:

     

    (i)           by
the application of the Deposit against the Closing Payment; and

     

    (ii)           as
to the balance of the Closing Payment remaining after the application of the
Deposit pursuant to Section 2.04(a)(i), by the Purchaser paying such amount to
or to the order of the Vendor by wire transfer of immediately available funds to
an account designated by Vendor; and

     

    (b)           Promissory Note.  by
executing a promissory note in the form attached hereto as Exhibit 2.03(b)
(“Promissory Note”)
pursuant to which Purchaser will be indebted to Vendor in the amount equal to
the Purchase Price less the Closing Payment, payable over a three-year term with
interest accruing at a rate of five percent (5%) per annum payable in monthly
installments of principal and interest.

     


    
      
         


      

      
        Page 2 of
26

        
          

        

      

      
         


      

    


    2.04           Guarantee.  As
security for the Promissory Note only, the Company shall guarantee the
performance of the obligations of the Purchaser under the Promissory Note, in
the form of the guarantee attached hereto as Exhibit 2.04 (the
“Guarantee”).  The
Guarantee will be secured by a hypothec on equipment, in the form of hypothec
attached hereto as Exhibit 2.04 to be dated as of the Closing Date and
registered in the Register of personal and movable real rights of the Province
of Quebec (the “Hypothec”).

     

    2.05           Post-Closing
Purchase Price Adjustment.

     

    (a)           Vendor
will deliver to Purchaser, within 30 days after the Closing Date, Vendor’s
closing working capital statement (the “Closing Working Capital
Statement”) setting forth the Vendor’s calculation of the closing working
capital of the Company, being the current assets of Company less the current
liabilities of the Company as of the close of business on the Closing Date,
determined in a manner consistent with the Company’s financial statements and in
accordance with Canadian generally accepted accounting principles consistently
applied and, for the purposes of this Agreement such calculation does not
include the Purchased Debt (the “Closing Working
Capital”).  The foregoing calculation of Closing Working
Capital is solely for purposes of adjustment of the Purchase Price pursuant to
this Section 2.04, and for greater certainty this shall not be considered in the
assessment of any obligations of the Vendor to indemnify Purchaser pursuant to
Section 8.02 for any breach or inaccuracy of any representation or warrantee or
any failure to perform or fulfill any covenant or obligations in this
Agreement.

     

    (b)           If,
within 30 days following delivery of the Closing Working Capital Statement,
Purchaser has not given Vendor written notice of its objection, (such notice
must contain a statement of the particular factual basis of objection), then the
Closing Working Capital Statement shall be final, conclusive and binding on the
Parties and deemed to be the “Final Closing Working Capital
Statement”.  If Purchaser gives such notice of objection, then
the issues in dispute will be submitted to BDO Dunwoody LLP/s.r.l. (“the Accountants”) for
resolution.  The determination by the Accountants, as set forth in a
notice delivered to the Parties by the Accountants, will be binding and
conclusive on the Parties and constitute the Final Closing Working Capital
Statement.  Vendor and Purchaser will each bear 50% of the fees of the
Accountants for such determination.

     

    (c)           The
Purchase Price shall be adjusted (i) downward on a dollar-for-dollar basis to
the extent the Closing Working Capital as set forth on the Final Closing Working
Capital Statement is less than One Million One Hundred and Sixty-Eight Thousand
Canadian Dollars (C$1,168,000.00) and to the extent of any long term liabilities
of the Company (other than the Purchased Debt), or (ii) upward on a
dollar-for-dollar basis to the extent the Closing Working Capital is greater
than One Million Three Hundred and Sixty-Eight Thousand Canadian Dollars
(C$1,368,000.00) otherwise than as a result of an increase in inventory or work
in progress due to an allocation of related party expenses not accounted for on
the November 13, 2009 working capital statement set forth at schedule 3.14
hereof.  The amount of the adjustment to the Purchase Price (which may
be a positive or negative number), if any, shall be referred to herein as the
“Post-Closing Adjustment
Amount”.

     


    
      
         


      

      
        Page 3 of
26

        
          

        

      

      
         


      

    


    (d)           The
Post-Closing Adjustment Amount shall be limited to $1,500,000US.

     

    (e)           The
Post-Closing Adjustment Amount, if any, shall first be applied by adjusting the
principal sum of the Promissory Note upward or downward in an amount equal to
the Post-Closing Adjustment Amount.

     

     

    Article
III.

    Representations
and Warranties of Vendor

    


    The Vendor represents and warrants as
follows to the Purchaser and acknowledges that the Purchaser is relying upon the
representations and warranties in connection with its purchase of the Purchased
Share and the Purchased Debt.

    


    3.01           Company Incorporation and Corporate
Power.  The Company is an unlimited liability corporation that
was duly formed, is existing and is in good standing under the laws of Alberta.
The Company has the necessary power to own or lease its properties and to carry
on its business as such business is presently conducted.

    


    3.02           Vendor Incorporation and Corporate
Power.  The Vendor is duly incorporated and validly existing
and in good standing under the Laws of its jurisdiction of incorporation. The
Vendor has the corporate power to enter into and perform its obligations under
this Agreement.

    


    3.03           Corporate
Authorization.  The execution and delivery of and performance
by the Vendor of, this Agreement have been authorized by all necessary corporate
action on the part of the Vendor.

    


    3.04           No Conflict.  The
execution and delivery of, and performance by the Vendor of the transaction of
purchase and sale contemplated by this Agreement:

    


    (a)           do
not and will not constitute or result in a violation or breach of, or conflict
with, or allow any person to exercise any rights under, any of the terms or
provisions of its constating documents or by-laws or the Company’s constating
document or by-laws;

    


    (b)           do
not and will not constitute or result in a material breach or violation of, or
conflict with or allow any person to exercise any rights under, any contract,
license, lease or instrument to which it is a party; and

    


    (c)           do
not result in the violation of any law.

    


    3.05           Required
Authorizations.  No material filing with, notice to, or
authorization of, any governmental entity is required on the part of the Vendor
or the Company as a condition to the lawful completion of the transactions
contemplated by this Agreement.

    


    3.06           Required Consents. Other than
consents from Wells Fargo Business Credit which is attached hereto at Exhibit 3.06, there
is no material requirement to obtain any consent, approval or waiver of a party
under any contract, license, lease or instrument that the Vendor
or


    
      
         


      

      
        Page 4 of
26

        
          

        

      

      
         


      

    


    the
Company is a party to, for the completion of the transactions contemplated by
this Agreement.

    


    3.07           Execution and Binding
Obligation.  This Agreement has been duly executed and
delivered by the Vendor and constitutes legal, valid and binding agreements of
it enforceable against it in accordance with its terms.

    


    3.08           Capitalization; Title to Purchased
Share and Purchased Debt. The authorized capital of the Corporation
consists of an unlimited number of common shares, of which only 1 common share
is issued and outstanding as fully paid and assessable. The Vendor owns the
Purchased Share and the Purchased Debt beneficially and of record with good and
marketable title, free and clear of all Liens Upon completion of the
transactions of purchase and sale contemplated by this Agreement, the Purchaser
will have good and valid title to the Purchased Share and Purchased Debt free of
all Liens, other than those Liens, if any, granted by Purchaser to third
parties. Purchaser acknowledges that the Purchased Share and Purchased Debt will
be subject to the standard restrictions on transfers contained in the Company’s
articles and as set forth in applicable corporate and securities law, and the
Vendor declares that no such restrictions apply to, or are in conflict with,
this transaction.

     

    3.09           No Other Agreements to
Purchase. No Person has any contractual right or privilege for (i) the
purchase or acquisition from the Vendor of the Purchased Share or Purchased
Debt, or (ii) the purchase, subscription, allotment or issuance of any equity
securities of the Company.

    


    3.10           Corporate
Records.  To the knowledge of the Vendor, the Company’s
corporate records are complete and accurate and include the Company’s articles
and by-laws, minutes of meetings and resolutions of Vendors and directors, and
the share certificate books, securities register, register of transfers and
register of directors.

    


    3.11           Subsidiaries.  The
Company has no subsidiaries and holds no share or other ownership, equity or
proprietary interests in any other Person.

    


    3.12           Broker’s or Finder’s
Fee.  No broker, agent or other intermediary is entitled to any
fee, commission or other remuneration in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of
the Vendor.

    


    3.13           Title to
Assets.  The Company owns the assets that are material to its
business as currently conducted and are reflected as being owned by it in the
books and records of the Company, including all of the equipment listed in
Schedule 3.13, free and clear of all Liens except for a Lien in favour of
Wells Fargo Business Credit (which shall be discharged as a condition of the
Closing).  No person has any contractual right or privilege for the
purchase or other acquisition from the Company of any assets that are material
to the Company’s business.

    


    3.14           No Undisclosed Material Liabilities
and Working Capital.  Other than (i) liabilities or obligations
known to the Purchaser or Pierre DesRosiers prior to the Closing Date; (ii)
liabilities or obligations disclosed in the Company’s most recent balance sheet
dated


    
      
         


      

      
        Page 5 of
26

        
          

        

      

      
         


      

    


    November
13, 2009 or the notes thereto and attached hereto as Schedule 3.14; (iii)
non-material liabilities or obligations incurred in the ordinary course of
business consistent with past practice; (iv) liabilities or obligations not yet
incurred under material contracts; or (v) liabilities or obligations that would
not reasonably be expected to, individually or in the aggregate, have a material
and adverse effect on the Company, there are no liabilities or obligations of
the Company of any kind whatsoever, whether accrued, contingent, absolute,
determined, determinable or otherwise. For the purposes of part (i) of this
Section 3.14, in no circumstance shall a liability or obligation of the Company
to the Vendor or its affiliates (i.e. a non-arm’s length  liability or
obligation) or a tax authority shall be determined or deemed to have been known
to the Purchaser or Pierre DesRosiers. The Closing Working Capital Statement is
accurate and complete in all material respects and the Company has no long-term
liabilities (other than the Purchased Debt) and a minimum of $1,168,000 of
Working Capital at the Closing (such $1,168,000 of Working Capital calculated
prior any increase in inventory or work in progress due to an allocation of
related party expenses not accounted for on the November 13, 2009 working
capital statement).

    


    3.15           Ordinary Course. Since the
date of the Company’s most recent balance sheet, the Vendor has not caused the
business of the Company to be carried on other than in the ordinary course of
normal day-to-day operations of the Company’s business consistent with past
practices.

    


    3.16           Material Contracts; Material
Equipment.  Vendor does not have actual knowledge (without
further inquiry) of (i) any material contracts of the Company, or (ii) any
material equipment owned or leased by the Company, in each case, other than
those identified on the list of material contracts and material equipment, which
list was prepared by the Purchaser and is attached hereto as Exhibits 3.13 and
3.16.  For greater certainty, except pursuant to Section 3.13
and this Section 3.16, the Vendor provides no other representation or warranty
whatsoever regarding Exhibits 3.13 and
3.16.

    


    3.17           Fair Market Value of the Purchased
Share. The fair market value of the Purchased Share is not derived
principally from real property situated in Canada for purposes of the
Canada-United States Tax Convention (1980), as amended.

    


    3.18           Residence of
Vendor.  Vendor is a resident of the United States for purposes
of the Canada-United States Tax Convention (1980), as amended.

    


    3.19           Treaty
Protection.  Vendor is entitled to the benefits of the Canada-United States Tax Convention
(1980), as amended, with respect to the income derived from the sale of
the Purchased Share to Purchaser by virtue of paragraph XXIX-A(3) of the Canada-United States Tax Convention
(1980), as amended, and the adjusted cost base and paid up capital of the
Purchased Share for purposes of the Income Tax Act (Canada) is,
to the knowledge of the Vendor, in each case approximately
US$1.00.


    
      
         


      

      
        Page 6 of
26

        
          

        

      

      
         


      

    

    


    Article
IV.

    Representations
and Warranties of Purchaser

    


    Purchaser represents and warrants as
follows to the Vendor and acknowledges and confirms that the Vendor is relying
on such representations and warranties in connection with the sale by the Vendor
of the Purchased Share and Purchased Debt:

    


    4.01           Incorporation and Corporate
Power. The Purchaser is a corporation incorporated and existing and in
good standing under the laws of its jurisdiction of incorporation. The Purchaser
has the corporate power to enter into and perform its obligations under this
Agreement.

    


    4.02           Corporate
Authorization.  The execution and delivery of and performance
by the Purchaser of this Agreement have been authorized by all necessary
corporate action on the part of the Purchaser.

    


    4.03           No Conflict.  The
execution and delivery of and performance by the Purchaser of this
Agreement:

    


    (a)           do
not and will not constitute or result in a violation or breach of, or conflict
with, or allow any Person to exercise any rights under, any of the terms or
provisions of its constating documents or by-laws;

    


    (b)           do
not and will not constitute or result in a breach or violation of, or conflict
with or allow any Person to exercise any rights under, any contract, license,
lease or instrument to which it is a party; and

    


    (c)           do
not result in the violation of any law.

    


    4.04           Required
Authorizations.  No filing with, notice to or authorization of,
any governmental entity is required on the part of the Purchaser as a condition
to the lawful completion of the transactions contemplated by this
Agreement.

    


    4.05           Execution and Binding
Obligation.  This Agreement has been duly executed and
delivered by the Purchaser and constitutes legal, valid and binding agreements
of the Purchaser, enforceable against it in accordance with its
terms.

    


    4.06           Purchaser’s
Financing.  The Purchaser will have at Closing all funds on
hand or irrevocable committed financing in place necessary to pay the Closing
Payment.  Attached as Exhibit 4.06 are executed copies of binding
commitment letters (the “Financing Commitments”) from
Banque du dévelopment du Canada (“BDC”) and the Bank of Montreal
(“BMO”).  The
Funds advanced by BDC and BMO pursuant to the financing commitment will be used
by Purchaser to pay the Closing Payment and (i) in the case of BDC, will be
secured by hypothecs over the fixed assets of the Purchaser and the Company
ranking ahead of the security taken by the Vendor on such fixed assets pursuant
to the Guarantee and the Hypothec: and (ii) in the case of BMO will be secured
by a hypothec on the universality of the Company’s assets,


    
      
         


      

      
         Page
7of 26

        
          

        

      

      
         


      

    


    ranking
ahead of all other security on all assets other than the fixed assets secured by
the hypothec in favor of BDC.

    


    4.07           Broker’s or Finder’s
Fee.  No broker, agent or other intermediary is entitled to any
fee, commission or other remuneration in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of
the Purchaser.

    


    4.08           Breach, Non-Performance and
Non-Compliance.  The Purchaser has not formulated the opinion
that any of the representations and warranties in Sections 3.04, 3.05, 3.06,
3.13, 3.15, 3.16 or 3.17 is incorrect in any material respect.

    


     

    Article
V.

    Conditions
of Closing

    


    5.01           Conditions to Obligations of
Vendor.  All obligations of Vendor under this Agreement are
subject to the fulfillment, at or prior to the Closing, of the following
conditions, any one or more of which may be waived in writing by Vendor in its
sole discretion:

    


    (a)           All
representations and warranties made by Purchaser in this Agreement shall be true
and correct in all material respects on and as of the Closing Date with the same
force and effect as if such representations and warranties had been made on and
as of such date. Purchaser shall have delivered to Vendor a certificate of a
senior officer of the Purchaser, signed and dated as of the Closing Date, to the
foregoing effect.

    


    (b)           Purchaser
shall have fulfilled, complied with or otherwise performed in all material
respects all obligations required under this Agreement to be performed by it on
or prior to the Closing Date.  Purchaser shall have delivered to
Vendor a certificate of a senior officer of the Purchaser, signed and dated as
of the Closing Date, to the foregoing effect.

    


    (c)           Purchaser
shall have paid the Purchase Price in accordance with Article II.

     

    (d)           Purchaser
shall have delivered or caused to be delivered all certificates, documents and
agreements to and which it is a party or signatory described in Article
VII.

    


    (e)           No
order of any court or administrative agency shall be in effect which restrains
or prohibits the transactions contemplated hereby, and there shall not have been
threatened, nor shall there be pending, any action or proceeding by or before
any court or governmental agency or other regulatory or administrative agency or
commission, challenging any of the transactions contemplated by this
Agreement.

    


    (f)           Vendor
shall have received such other certificates, instruments and documents,
reasonably satisfactory in form and substance to Vendor, in confirmation of the
representations and warranties of Purchaser or in furtherance of the
transactions contemplated by this Agreement as Vendor or their legal counsel may
reasonably request.


    
      
         


      

      
        Page 8 of
26

        
          

        

      

      
         


      

    


    


    5.02           Conditions to Obligations of
Purchaser. All obligations of Purchaser under this Agreement are subject
to the fulfillment, at or prior to the Closing, of the following conditions, any
one or more of which may be waived in writing by Purchaser in its sole
discretion:

    


    (a)           All
representations and warranties made by Vendor in this Agreement and in any
agreement referenced herein shall be true and correct in all material respects
on and as of the Closing Date with the same force and effect as if such
representations and warranties had been made on and as of such date. However, if
a representation and warranty is qualified by materiality or material adverse
effect, it must be true and correct in all respects. The Vendor shall have
delivered to Purchaser a certificate of a senior officer of the Vendor, signed
and dated as of the Closing Date, to the foregoing effect.

    


    (b)           Vendor
shall have fulfilled, complied with or otherwise performed in all material
respects all obligations required under this Agreement be performed by it on or
prior to the Closing Date.  The Vendor shall have delivered to
Purchaser a certificate of a senior officer of the Vendor, signed and dated as
of the Closing Date, to the foregoing effect.

    


    (c)           Vendor
shall have delivered or cause to be delivered all certificates, documents and
agreements to which it is a party or signatory described in Article
VI.

    


    (d)           Vendor
shall sell, assign and transfer to Purchaser all of Vendor’s right title and
interest in and to the Purchased Share and the Purchased Debt.

     

    (e)           No
order of any court or administrative agency shall be in effect which restrains
or prohibits the transactions contemplated hereby, and there shall not have been
threatened, nor shall there be pending, any action or proceeding by or before
any court or governmental agency or other regulatory or administrative agency or
commission, challenging any of the transactions contemplated by this
Agreement.

    


    (f)           The
following consents, waivers, authorizations and approvals required in connection
with the execution, delivery and performance of this Agreement, shall have been
duly obtained and/or assumed: Wells Fargo Business Credit.

    


    (g)           There
shall have been no loss, damage or destruction to the Assets which materially
impairs the use or the value of the Assets or the Company.  The
Company shall not have suffered any material adverse change in its financial
condition, results of operations, assets, liabilities, or business.

    


     

    Article
VI.

    Deliveries
by Vendor at Closing

    


    6.01           At
Closing, the Vendor shall deliver to Purchaser the following documents in form
and substance reasonably satisfactory to Purchaser:


    
      
         


      

      
        Page 9 of
26

        
          

        

      

      
         


      

    


    (a)            Share
certificates, registered in the name of the Vendor, free and clear of all Liens,
duly endorsed by Vendor or with stock powers attached, representing all of the
issued and outstanding Shares;

     

    (b)           The
AMP Promissory Note, duly endorsed for transfer;

     

    (c)           The
certificates referred to in Section 5.01(a) and Section 5.01(b);

    


    (d)           An
agreement, duly executed by HK Engine Components, LLC for the supply of engine
components, for a term of three (3) years from the date of Closing in the form
attached hereto as Exhibit
6.01(d);

    
 

    (e)           An
agreement duly executed by Magnetech Industrial Services, Inc. for the supply of
engine components, for a term of three (3) years from the date of Closing in the
form attached hereto as Exhibit
6.01(e);

    


    (f)           The
resignation of each member of the Board of Directors and each officer of the
Company (other than Pierre DesRosiers) effective as of the Closing
Date;

    


    (g)           The
original books and records of the Company existing on the Closing Date,
including, without limitation, corporate minute books, financial and tax
records;

    


    (h)           Vendor
shall deliver to Purchaser a certificate of status, compliance, good standing or
like certificate with respect to the Company from the Province of Alberta,
together with certified copies of (A) the charter documents and by-laws of the
Vendor, (B) the resolutions of the Vendors and the board of directors of the
Vendor, as the case may be, approving the execution, delivery and performance of
this Agreement, and (C) a list of the directors and officers authorized to sign
this Agreement together with their specimen signatures; and

    


    (i)           Vendor
shall deliver to Purchaser consents, waivers, authorizations and approvals
listed in Section 5.02(e).

    


    6.02           Additionally Requested Documents;
Post-Closing Assistance.  At the reasonable request of
Purchaser at Closing and at any time or from time to time thereafter, Vendor
shall cooperate with Purchaser to put Purchaser in actual possession and
operating control of the Company, execute and deliver such further instruments
of sale, conveyance, transfer and assignment, as Purchaser may reasonably
request in order to effectively convey, transfer and assign the same to
Purchaser, and to take such other actions as Purchaser may reasonably request to
effectuate the intent of this Agreement and the transactions contemplated
hereby.

    


    6.03           Closing and Post-Closing Tax
Matters. Vendor shall certify Part D of Form T2062C prepared by the
Purchaser and the Purchaser shall complete Parts A, B and C of Form T2062C and
file such forms with the Canada Revenue Agency within thirty (30) days after the
Closing.


    
      
         


      

      
        Page 10 of
26

        
          

        

      

      
         


      

    


    Article
VII.

    Deliveries
by Purchaser at Closing

    


    7.01           At
Closing, Purchaser shall deliver or cause to be delivered to Vendor the
following in a form and substance reasonably satisfactory to
Vendor:

    


    (a)           Purchaser
shall deliver to Vendor a certificate of status, compliance, good standing or
like certificate with respect to the Purchaser from the jurisdiction of its
incorporation, together with certified copies of (A) the charter documents and
extracts from the by-laws of the Purchaser relating to the execution of
documents, (B) all resolutions of the Vendors and the board of directors of the
Purchaser, as the case may be, approving the execution, delivery and performance
of this Agreement, and (C) a list of its officers and directors authorized to
sign this Agreement together with their specimen signatures;

    


    (b)           The
certificates referred to in Section 5.02(a) and Section 5.02(b);
and

    


    (c)           The
Closing Payment and an executed copy of the Promissory Note in form and
substance satisfactory to the Vendor.

    


     

    Article
VIII.

    Survival
of Provisions and Indemnification

    


    8.01           Survival.  The
respective representations, warranties and covenants of each of the parties to
this Agreement, including all statements contained in any schedule, exhibit or
officer’s certificate delivered pursuant hereto, shall be deemed to have been
relied upon by the parties hereto and shall survive the Closing, and the
consummation of the transactions contemplated hereby as follows: (a) the
representations and warranties contained in Sections 3.01, 3.02, 3.03, 3.07,
3.08, 4.01, 4.02 and 4.05 (and the corresponding representations and warranties
set out in the certificates delivered pursuant to Sections 5.02(a) and 5.03(a))
shall survive indefinitely and shall not terminate; (b) the representations and
warranties contained Section 3.14, in respect of liabilities for amounts due to
any tax authority only, will survive until 6 months after the expiration of the
period during which any tax assessment may be issued by a governmental entity in
respect of any taxation year to which such representations and warranties
extend; and (c) all other representations and warranties shall survive for a
period of eighteen (18) months after the Closing Date; provided, that any
representation or warranty in respect of which indemnity may be sought under
this Section 8, and the indemnity with respect thereto, shall survive the time
at which it would otherwise terminate pursuant to this Section 8.01 if notice of
the breach thereof giving rise to such right or potential right of indemnity
shall have been given to the party against whom such indemnity may be sought
prior to such time.  Notwithstanding the foregoing, any representation
and warranty involving fraud or fraudulent misrepresentation by the party giving
that representation and warranty will survive and continue in full force and
effect without limitation of time. The covenants and agreements of the parties
contained in this Agreement shall remain operative and in full force and shall
survive until the performance by the applicable party hereto of such covenant
and agreement.  No investigation by the parties made heretofore
or


    
      
         


      

      
        Page 11 of
26

        
          

        

      

      
         


      

    


    hereafter
shall affect the representations and warranties of the parties contained in or
made pursuant hereto.

    


    8.02           Indemnification by
Vendor.  Subject to Section 8.07, following Closing the Vendor
will indemnify and save the Purchaser and the Corporation, and their respective
directors, officers and employees harmless of and from, and will pay for, any
losses, liabilities, damages or out-of-pocket expenses (including reasonable
legal fees and expenses) (“Losses”) suffered by, imposed
upon or asserted against it as a result of, in respect of, connected with, or
arising out of, under, or pursuant to:

    


    (a)           any
breach or inaccuracy of any representation or warranty in Article 3 or the
certificate to be delivered pursuant to Section 5.03(a) for which a notice of
claim has been provided to the Vendor within the applicable period specified in
Section 8.01; and

    


    (b)           any
failure of the Vendor to perform or fulfill any of its covenants or obligations
under this Agreement.

    


    8.03           Indemnification by
Purchaser.  Subject to Section 8.07, following Closing the
Purchaser will indemnify and save the Vendor its directors, officers and
employees harmless of and from, and will pay for, any Losses suffered by,
imposed upon or asserted against it as a result of, in respect of, connected
with, or arising out of, under, or pursuant to:

    


    (a)           any
breach or inaccuracy of any representation or warranty in Article 4 or the
certificate to be delivered pursuant to Section 5.02(a) for which a notice of
claim has been provided to the Vendor within the applicable period specified in
Section 8.01; and

    


    (b)           any
failure of the Purchaser to perform or fulfill any of its covenants or
obligations under this Agreement.

    


    8.04           Rules Regarding
Indemnification.  The obligations and liabilities of each party
which may be subject to indemnification liability hereunder (the “Indemnifying Party”) to the
other party (the “Indemnified Party”) shall be subject to the following terms
and conditions:

    


    (a)           Claims by
Non-Parties.  Within twenty (20) days (or such earlier time as
might be required to avoid prejudicing the Indemnifying Party’s position) after
receipt of notice of commencement of any action evidenced by service of process
or other legal pleading, or with reasonable promptness after the assertion of
any claim by a third party, the Indemnified Party shall give the Indemnifying
Party written notice thereof together with a copy of such claim, process or
other legal pleading, and the Indemnifying Party shall have the right to
undertake the defense thereof by representatives of its own choosing and at its
own expense, subject however to the rights of any insurance company insuring
against liabilities related to the subject party claim to appoint
counsel.  Notwithstanding the foregoing, the Indemnified Party may
participate in the defense with counsel of its own choice and at its own expense
(provided that the Indemnifying Party will bear the expense of counsel for the
Indemnified Party if the Indemnified Party could have an inconsistent or
conflicting interest from that of the Indemnifying Party or one
or


    
      
         


      

      
        Page 12 of
26

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              more
      legal defenses that are different from or additional to those available to
      the Indemnifying
Party).  Further:

            


    

    


    (i)           If
the Indemnifying Party, by the thirtieth (30th) day after receipt of notice of
any such claim (or, if earlier, by the tenth 10th day
preceding the day on which an answer or other pleading must be served in order
to prevent judgment by default in favor of the person asserting such claim),
does not elect to defend against such claim, the Indemnified Party, upon further
notice to the Indemnifying Party, will have the right to undertake the defense,
compromise or settlement of such claim on behalf of or for the account and risk
of the Indemnifying Party and at the Indemnifying Party’s expense, subject to
the right of the Indemnifying Party to assume the defense of such claim at any
time prior to settlement, compromise or the final determination
thereof.  For the purposes of this Article VIII, “final determination” or “finally determined”, as the
case may be, means as mutually agreed by the parties in writing or as determined
by a non-appealable and final judgment in favour of the Indemnified Party or a
judgment in favour of the Indemnified Party which the Indemnifying Party has
waived (in writing) its right to appeal.

    


    (ii)           Notwithstanding
anything to the contrary contained in this Section 8.04(a), the Indemnifying
Party shall not settle any claim without the consent of the Indemnified Party
unless such settlement involves only the payment of money and the claimant
provides to the Indemnified Party a release from all liability in respect of
such claim.  If the settlement of the claim involves more than the
payment of money, the Indemnifying Party shall not settle the claim without the
prior consent of the Indemnified Party, which consent shall not be unreasonably
withheld.

    


    (iii)           The
Indemnified Party and the Indemnifying Party will each cooperate with all
reasonable requests of the other for the purpose of defending against any
claims.

    


    (iv)           The
Indemnifying Party shall make all payments pursuant to the indemnification
provisions contained in this Section 8.04(a) within ten (10) business days after
final determination of the amount thereof.

    


    (b)           Claims by a
Party.  In the event any Indemnified Party should have a claim
for indemnification against any Indemnifying Party that does not involve a third
party claim, the Indemnified Party shall deliver notice of such claim with
reasonable promptness to the Indemnifying Party.  The failure by any
Indemnified Party so to notify the Indemnifying Party shall not relieve the
Indemnifying Party from any liability that it may have to such Indemnified Party
with respect to any claim made pursuant to this Section 8.04(b).  If
the Indemnifying Party does not notify the Indemnified Party within thirty (30)
days following its receipt of such notice that the Indemnifying Party disputes
its liability to the Indemnified Party under this Article VIII, or the amount
thereof, the claim specified by the Indemnified Party in such notice shall be
conclusively deemed a


    
      
         


      

      
        Page 13 of
26

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              liability
      of the Indemnifying Party under this Article VIII, and the Indemnifying
      Party shall pay the amount of such loss to the Indemnified Party on demand
      or, in the case of any notice in which the amount of the claim (or any
      portion of the claim) is estimated, on such later date when the amount of
      such claim (or such portion of such claim) becomes finally
      determined.  If the Indemnifying Party has timely disputed its
      liability with respect to such claim, the Indemnifying Party and the
      Indemnified Party shall negotiate in good faith to resolve such dispute or
      pursue such remedies as may be available hereunder, at law or in
      equity.

            


    

    


    8.05           Section 116 Withholding and Tax
Indemnification. The Vendor will indemnify and hold harmless the
Purchaser and its directors, officers and employees from (i) any liability, Tax,
or other damages (including interest and penalties) incurred by such persons as
a result of any failure to withhold amounts pursuant to section 116 of the
Income Tax Act (Canada) (the "Tax Act"); (ii) any Taxes owing by the Company
with respect to the application of section 80 of the Tax Act and similar
applicable provincial legislation and directly relating to the Purchased Debt or
the debt forgiven as set forth in part D of the recitals to this Agreement in
excess of the aggregate of (a) all pre-Closing Tax losses of the Company as
calculated for the Tax period ending immediately prior to the Closing Date and
available to offset such Taxes ((other than such losses not available to the
Company in periods after the Closing due to a reasonably avoidable cause
attributable to the Company or the Purchaser)); and (b) all pre-Closing Tax
pools available to offset such Taxes pursuant to section 80 of the Tax Act and
similar applicable provincial legislation, provided that the Parties shall also
act in good faith to minimize, to all extent possible, such additional Taxes
including by filing any available Tax elections or agreements; and (iii) any
additional Tax liabilities owing by the Company to the tax authorities relating
to Tax periods ending prior to the Closing Date and not set forth in the
Pre-Closing Tax Returns and paid by the Vendor net of any pre-Closing Tax losses
of the Company as calculated immediately prior to the Closing Date and available
to offset such Taxes (other than such losses not available to the Company in
periods after the Closing due to a reasonably avoidable cause attributable to
the Company or the Purchaser) not already applied as set forth in parts (i) and
(ii) above, provided that the Parties shall also act in good faith to minimize,
to all extent possible, such additional Tax liabilities including by filing any
available Tax elections or agreements. For greater certainty, such
indemnification shall not be subject to the Basket, Cap or De Minimis Exception
referred to above, or to any limitation of time other than provided by
applicable law.

     

    8.06           Right to Set-Off. In the event
that the Vendor is the Indemnifying Party under this Article VIII, the Purchaser
shall have the right to set-off any amounts owed by the Indemnifying Party to
Purchaser as a result of such indemnification against equivalent principal
amounts outstanding under the Promissory Note only with respect to a Claim by
the Purchaser for indemnification as a result of (i) a failure by the Vendor to
transfer ownership of the Purchased Shares and Purchased Debt to the Purchaser
free and clear of all Liens; (ii) a failure by the Company to discharge any
security on its assets upon Closing (other than Liens granted by the Purchaser);
or (iii) an assessment or demand by the tax authorities with respect to any
matter referred to in section 8.05. For any other Claim for indemnification by
the Purchaser under this Article VIII, such right to set-off shall only be
permitted if the amounts so payable have been finally determined and provided
that interest accrued on such principal amounts prior to the date of set-off
shall remain due and payable by the Purchaser to the Vendor in accordance with
the terms of the Promissory Note.


    
      
         


      

      
        Page 14 of
26

        
          

        

      

      
         


      

    

    


    8.07           Limitations on Indemnification.
Notwithstanding anything to the contrary contained in this Section
8:

    


    (a)           neither
Vendor, on the one hand, nor Purchaser, on the other hand, shall be required to
indemnify the other or its Vendors, directors, officers and employees in respect
of any Losses suffered by such other parties as a result of the breach of any
representation or warranty contained in this Agreement unless and until the
aggregate amount of all Losses exceeds Seventy-Five Thousand United States
Dollars (US$70,000.00) (the “Basket”), at which point such
indemnification obligation shall be from and against all Losses which exceed the
Basket, provided that the Basket shall not apply to any Losses related to any
willful or fraudulent breach by any party hereto of any provision in this
Agreement or any document, instrument or agreement that is to be delivered to
the other party pursuant to the terms of this Agreement.

    


    (b)           the
aggregate amount of Vendor’ indemnification obligations or Purchaser’s
indemnification obligations for breach of any representation or warranty
contained in this Agreement shall not exceed One Million One Hundred Thousand
United States Dollars (US$1,100,000.00) (the “Cap”), provided that the Cap
shall not apply to any Losses related to any willful or fraudulent breach by any
party hereto of any provision in this Agreement or any document, instrument or
agreement that is to be delivered to the other party pursuant to the terms of
this Agreement.

    


    (c)           neither
the Vendor, on the one hand, nor Purchaser, on the other hand, shall be required
to indemnify the other or its Vendors, directors, officers and employees in
respect of any individual Loss suffered by such other parties as a result of the
breach of any representation or warranty contained in this Agreement if such
Loss is valued at less than One Thousand United States Dollars (US$1,000.00)
(the “De Minimis
Exception”), and Losses falling within the De Minimis Exception shall not
be included in the Basket so long as the sum total of Losses falling within the
De Minimis Exception do not exceed Twenty Five Thousand United States Dollars
(US$25,000.00).

    


    (d)           A
party has no obligation or liability for indemnification or otherwise with
respect to any representation or warranty made by such party in this Agreement,
or the certificates delivered pursuant to Sections 5.02(a) and 5.03(a), after
the end of the applicable time period specified in Section 8.01, except for
claims relating to the representations and warranties that the party has been
notified of prior to the end of the applicable time period.

    


    (e)           A
party has no obligation or liability for indemnification or otherwise with
respect to any breach or inaccuracy of any representation or warranty in this
Agreement, or the certificates delivered pursuant to Sections 5.02(a) and
5.03(a), or any failure to perform or fulfill any covenants or obligations, if
the party making the claim had actual knowledge of the breach, inaccuracy or
failure to perform on or prior to Closing.  For purposes of this
paragraph, actual knowledge is knowledge that is acquired because the events,
circumstances and consequences of them were clear on their face from
materials


    
      
         


      

      
        Page 15 of
26

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              provided
      to or obtained by the party making the claim on or prior to Closing and,
      for greater certainty, includes any waiver of a Closing condition by such
      party.

            


    

    


    (f)           The
Vendor has no liability for, or obligation with respect to, any special,
indirect, consequential, punitive or aggravated damages.

    


    (g)           Notwithstanding
the provisions of the Limitations Act, 2002
(Ontario), Civil Code of
Quebec S.Q. 1991, c.64 or any other statute, a proceeding or arbitration
in respect of a claim for indemnification or otherwise arising from any breach
or inaccuracy of any representation or warranty in this Agreement must be
commenced on or before six months after the date on which the party making the
representation or warranty was notified of the claim, so long as the party was
notified of the claim prior to the end of the applicable time period specified
in Section 8.01. Any applicable limitation period is extended or varied to the
full extent permitted by law to give effect to this Section
8.08(g).

    


    (h)           Any
Indemnified Party is not entitled to double recovery for any claims even though
they may have resulted from the breach of more than one of the representations,
warranties, covenants and obligations of the Indemnifying Party in this
Agreement.

    


    (i)           Nothing
in this Agreement in any way restricts or limits the general obligation at law
of an Indemnified Party to mitigate any Loss which it may suffer or incur by
reason of the breach by an Indemnifying Party of any representation, warranty,
covenant or obligation of the Indemnifying Party under this
Agreement.  If any claim can be reduced by any recovery, settlement or
otherwise under or pursuant to any insurance coverage, or pursuant to any claim,
recovery, settlement or payment by or against any other person, the Indemnified
Party shall take all appropriate steps to enforce such recovery, settlement or
payment and the amount of any Losses of the Indemnified Party will be reduced by
the amount of insurance proceeds actually recoverable by the Indemnified
Party.

    


    (j)           Except
as provided in this Section 8.08(j), the indemnities provided in Section 8.02
and Section 8.03 constitute the only remedy of the Purchaser or the Vendor,
respectively, against a party in the event of any breach of a representation,
warranty, covenant or agreement of such party contained in this Agreement. The
Parties acknowledge that the failure to comply with a covenant or obligation
contained in this Agreement may give rise to irreparable injury to a party
inadequately compensable in damages.  Accordingly, a party may seek to
enforce the performance of this Agreement by injunction or specific performance
upon application to a court of competent jurisdiction without proof of actual
damage (and without requirement of posting a bond or other
security).  Each of the Purchaser and the Vendor expressly waives and
renounces any other remedies whatsoever, whether at law or in equity, which it
would otherwise be entitled to as against any other Party.


    
      
         


      

      
        Page 16 of
26

        
          

        

      

      
         


      

    


    8.08            Guarantee by MISCOR. In the
event that the Vendor is the Indemnifying Party under this Article VIII, MISCOR
Group, Ltd. hereby agrees to be jointly and severally (solidarily) liable with
the Vendor for any indemnification amounts payable by the Vendor to the
Purchaser pursuant to this Article VIII.

     

     

    Article
IX.

    Post-Closing
Covenants

    


    9.01           Guarantee.  Immediately
following the Closing, the Purchaser will cause the Company to execute and
deliver the Guarantee.

    


    9.02           Non
Competition.  For the period of three years following the
Closing Date (and expiring on the third anniversary of the Closing Date), the
Vendor shall not, on its own behalf or on behalf of or in connection with any
person, directly or indirectly, in any capacity whatsoever including as an
employer, employee, principal, agent, joint venturer, partner, shareholder or
other equity holder, independent contractor, licensor, licensee, franchiser,
franchisee, distributor, consultant, supplier or trustee or by and through any
corporation, cooperative, partnership, trust, unincorporated association or
otherwise carry on, be engaged in, have any financial or other interest in or be
otherwise commercially involved in any endeavour, activity or business in all or
any part of the Province of Quebec which is substantially the same as or is in
competition with the Business as it is presently conducted.

    


    9.03           Confidentiality.  After
the Closing, the Vendor will keep confidential all information in its possession
or under its control relating to the Company and the Business, unless such
information is or becomes generally available to the public other than as a
result of a disclosure by the Vendor in violation of this
Agreement.

     

    9.04           AMP and Miscor
Marks.  The Purchaser hereby acknowledges that the Vendor owns
or has the right to use various trademarks, trade names, service marks,
insignia, symbols, logos, and decorative designs, whether or not registered, in
connection with the names (i) “American Automotive Power” (the “American Motive Power Marks”);
(ii) Miscor, Miscor Group, or any variations thereof (the “Miscor Marks”); and (iii)
“AMP” (the “AMP
Marks”).  Purchaser acknowledges that the transactions
contemplated by this Agreement do not grant to Purchaser or the Company any
right or license to use such American Motive Power Marks or Miscor Marks after
the Closing, in any manner whatsoever, except that the Vendor grants the Company
an exclusive license to use the names “AMP Rail Services Canada” and
“AMP Canada” from and
after the Closing.  For greater certainty, the Purchaser shall not be
permitted to use the name “AMP” alone, nor shall Purchaser use any logos
currently used by Company (i.e., the AMP-train-in-front-of-flags logo currently
used on stationary, website, and labels).  Purchaser and Company will
use their respective best efforts to establish a distinct market identity for
the Company and to avoid any possible confusion that Company is a subsidiary of
or otherwise affiliated with the Vendor or its affiliates.  The
Purchaser’s failure or refusal to fully comply with this Section 9.04 will cause
immediate and irreparable injury to the Vendor that cannot be adequately
compensated in money damages. Therefore, the Purchaser agrees that in the event
of any actual or threatened violation of any restrictions of this Section 9.04,
the Vendor may, in addition to any other remedy, enforce the performance of this
Agreement by way of an injunction or specific performance upon application to a
court of competent jurisdiction without


    
      
         


      

      
        Page 17 of
26

        
          

        

      

      
         


      

    


    proof of
actual damages (and without the requirement of posting a bond or other
security), and, notwithstanding that damages may be readily quantifiable, the
Purchaser agrees (and agrees to cause the Company) not to plead sufficiency of
damages as a defence in any proceeding.

     

    9.05           Repayment of Crane Payoff Amount.
Within 30 days of the Closing, the Purchaser shall pay, or cause to be
paid, to the Vendor (or as otherwise directed by the Vendor) US$29,621.00, which
is the amount that Vendor recently paid to GE Capital to payoff the overhead
crane indebtedness (“Crane
Payoff Amount”) failing which, the Crane Payoff Amount (or such lesser
amount in the event of partial payment by the Purchaser from time to time, the
“Owed Amount”) shall become an
amount due and payable by the Purchaser to the Vendor, and shall bear interest
at a rate of five percent (5%) per annum until there shall be no Owed Amount.
Interest at such rate shall accrue daily and be calculated on the basis of the
actual number of days elapsed in a year of 365 days or 366 days, as the case may
be.

     

    9.06           Access to Books and Records.
For a period of seven (7) years from the Closing Date or for such longer period
as may be required by law, the Purchaser will retain all original books and
records relating to the Company existing on the Closing Date.  So long
as any such books and records are retained by the Purchaser pursuant to this
Agreement, the Vendor has the right to inspect and to make copies (at its own
expense) of them at any time upon reasonable request during normal business
hours and upon reasonable notice for any proper purpose and without undue
interference to the business operations of the Company. The Purchaser has the
right to have its representatives present during any such
inspection.

    


     

    Article
X.

    Miscellaneous

    


    10.01           Preparation of Tax
Returns.  The Vendor shall be responsible for preparing and
filing, within the times and in the manner prescribed by law (subject, however,
to filing under any extension), all Tax Returns of the Company for any Tax
period ending prior to the Closing Date (which, for greater certainty, shall
include the tax returns due as a result of the acquisition of control of the
Company as a result of this transaction) that are required to be filed after the
Closing Date (“Pre-Closing Tax
Returns”). The Purchaser agrees to reasonably co-operate with the
Vendor’s preparation and filing of such Pre-Closing Tax Returns, if so requested
by Vendor.  The Vendor shall pay all Taxes owed under the Pre-Closing
Tax Returns.  The Purchaser shall be responsible for preparing, filing
all Tax Returns and paying all Taxes of the Company for any Tax period ending on
or after the Closing Date (“Post-Closing Tax Returns”).
The Vendor agrees to reasonably co-operate (at the Purchaser’s expense) with the
Purchaser’s preparation and filing of such Post-Closing Tax Returns, if so
requested by the Purchaser.  The Purchaser shall pay all Taxes owed
under the Post-Closing Tax Returns.  For the purposes of section 8.05
and this Section 10.01, “Tax” and "Taxes" shall mean any and all
taxes, duties, fees, excises, premiums, assessments, imposts, levies and other
charges or assessments of any kind whatsoever imposed by any governmental entity
and "Tax Returns" shall
mean any and all returns, reports, declarations and elections, filed or required
to be filed in respect of Taxes. The Purchaser shall not (or shall not cause or
permit the Company to) amend, refile or otherwise modify any Pre-Closing Tax
Returns or any Tax Returns of the Company that were filed prior to the Closing
Date without the prior written consent of the Vendor, which consent may be
withheld in Vendor’s sole discretion. The Parties agree that Vendor shall not
(and shall not cause the


    
      
         


      

      
        Page 18 of
26

        
          

        

      

      
         


      

    


    Company)
to elect under subsection 256(9) of the Tax Act so that control of the Company
shall be considered to have been acquired on the Closing Date.

    


    10.02           Assignment.  Other
than as provided for herein, no party may assign any rights or delegate any
obligations under this Agreement without the prior written consent of the other
party, and any prohibited assignment or delegation will be null and
void.

    


    10.03           Other
Expenses.  Except as otherwise provided in this Agreement, the
Vendor shall pay his or her own expenses (including the fees and expenses of
legal counsel, accountants and other professional advisors), together with any
and all expenses of the Company up to and including the Closing Date, incurred
in connection with the negotiation, execution, and implementation of the
transactions contemplated under this Agreement, and Purchaser shall pay all of
its expenses (including the fees and expenses of legal counsel, accountants and
other professional advisors), together with any and all expenses of the Company
following the Closing Date, incurred in connection with the negotiation,
execution, and implementation of the transactions contemplated under this
Agreement.

    


    10.04           Notices.  All
notices, requests, demands, waivers and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
deemed to have been duly given: (a) if delivered personally, on the date
received, (b) if delivered by overnight courier, on the day after mailing, or
(c) if mailed, four (4) days after mailing by first class certified mail, return
receipt requested and with postage prepaid.  Any such notice shall be
sent as follows:

    


    
      	 
      	
              To Vendor or to MISCOR Group,
      Ltd.:

            
	 
      	 
      	 
      
	 
      	
              c/o
      MISCOR Group, Ltd.

            
	 
      	
              1125
      South Walnut St.

            
	 
      	
              South
      Bend, Indiana 46619

            
	 
      	
              Attn:  John
      A. Martell

            
	 
      	 
      	 
      
	 
      	
              with
      a copy to:

            
	 
      	 
      
	 
      	
              Stikeman
      Elliott LLP

            
	 
      	
              Suite
      5300, Commerce Court West

            
	 
      	
              199
      Bay Street,

            
	 
      	
              Toronto,
      ON  M5L 1B9

            
	 
      	
              Attn:
      Michael Burkett

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              To
      Purchaser:

            
	 
      	 
      	 
      
	 
      	
              4107730 Canada
      Inc. d.b.a. Novatech,
      Inc.

            
	 
      	
              1830
      Rue LeBer

            
	 
      	
              Montreal,
      Quebec H3K2A4

            
	 
      	
              Attn:

            	
              Pierre
      DesRosiers and

            
	 
      	 
      	
              Ralph
      Mikhail

            
	 
      	 
      	 
      


    

    



    
      
         


      

      
        Page 19 of
26

        
          

        

      

      
         


      

    


    


    
      	 
      	
              with
      a copy to:

            	 
      
	 
      	 
      	 
      
	 
      	
              Jan
      Holland, Avocat Inc./Attorney Inc.

            	 
      
	 
      	
              1100
      rue De La Gauchetière Ouest

            	 
      
	 
      	
              Bureau
      280

            	 
      
	 
      	
              Montréal,
      Québec H3B 2S2

            	 
      
	 
      	
              Attn:  Jan
      Holland

            	 
      


    

    


    10.05           Controlling Law and
Jurisdiction.  This Agreement is governed by and interpreted
and enforced in accordance with the laws of the Province of Quebec and
the federal laws of Canada applicable therein. Each Party irrevocably attorns
and submits to the exclusive jurisdiction of the Quebec courts situated in the
City of Montreal and waives objection to the venue of any proceeding in such
court or that such court provides an inconvenient forum.

    


    10.06           Headings.  Any
paragraph headings in this Agreement are for convenience of reference only and
shall not be considered or referred to in resolving questions of
interpretation.

    


    10.07           Benefit.  This
Agreement becomes effective only when executed by the Vendor and the Purchaser,
and after that time, shall be binding upon and shall inure to the exclusive
benefit of the parties hereto and their respective successors and
assigns.  This Agreement is not intended to, nor shall it, create any
rights in any other party. Except as provided in Section 9.13, no person, other
than the parties, shall be entitled to rely on the provisions of this Agreement
in any action, suit, proceeding, hearing or other forum.  The parties
reserve their right to vary or rescind the rights, granted by or under this
Agreement to any person who is not a party, at any time and in any way
whatsoever, without notice to or consent of that person save and except for each
Vendor Rep (defined below) entitled to benefit under Section 10.13.

    


    10.08           Partial
Invalidity.  The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other provisions
hereof, and this Agreement shall be construed in all respects as if such invalid
or unenforceable provisions were omitted.

    


    10.09           Waiver.  Neither the
failure nor any delay on the part of any party hereto in exercising any rights,
power or remedy hereunder shall operate as a waiver thereof, or of any other
right, power or remedy; nor shall any single or partial exercise of any right,
power or remedy preclude any further or other exercise thereof, or the exercise
of any other right, power or remedy. No waiver of any of the provisions of this
Agreement shall be void unless it is in writing and signed by the party against
which it is sought to be enforced.

    


    10.10           Counterparts and
Facsimiles.  This Agreement may be executed in two or more
counterparts each of which shall be deemed an original and all of which together
shall constitute but one and the same instrument.  The signature page
to this Agreement and all other documents required to be executed at Closing may
be delivered by facsimile and the signatures thereon shall be deemed effective
upon receipt by the intended receiving party.

    


    10.11           Legal Fees and
Costs.  Subject to the provisions of Article VIII, in the event
any party hereto incurs legal expenses to enforce or interpret any provision of
this Agreement, the


    
      
         


      

      
        Page 20 of
26

        
          

        

      

      
         


      

    


    prevailing
party will be entitled to recover such legal expenses, including, without
limitation, reasonable legal fees, costs and disbursements, in addition to any
other relief to which such party shall be entitled.

    


    10.12           Entire Agreement, Amendments and
Termination.  There are no representations, warranties,
covenants, conditions or other agreements, express or implied, collateral,
statutory or otherwise, between the parties in connection with the subject
matter of this Agreement, except as specifically set forth in this
Agreement.  The Parties have not relied and are not relying on any
other information, discussion or understanding in entering into and completing
the transactions contemplated by this Agreement. Notwithstanding the forgoing,
this agreement can be modified or clarified by an agreement in writing signed by
Purchaser and Vendor. This Agreement may not be modified or clarified orally.
This Agreement may be terminated by mutual written consent of the Vendor and the
Purchaser, and shall automatically terminate if the Closing has not occurred on
the Closing Date (or such later date as the parties may agree to).

    


    10.13           No Amendment to
Articles.  For a period of seven (7) years after the Closing
Date, the Purchaser shall not, and shall not permit the Company, or any
successor or assign by amalgamation or otherwise, to amend, repeal or modify any
provision in the Company’s articles of incorporation or by-laws relating to the
exculpation or indemnification of any current or former officer or director
(unless required by law) who, as a representative of the Vendor, served in such
capacity, as applicable (each, a “Vendor Rep”), it being the
intent of the parties that each Vendor Rep shall continue to be entitled to such
exculpation and indemnification to the full extent of the law.  If the
Company or any successor or assign (i) consolidates or amalgamates with or
merges into any other person or (ii) transfers all or substantially all of its
properties and assets to any person, then, and in each such case, proper
provisions shall be made so that the successors and assigns of the Corporation
assume all of the obligations set forth in this Section 10.13.  This
Section 10.13 is intended for the benefit of, and is enforceable by, each Vendor
Rep and his or her heirs, executors and representatives, and are in addition to,
and not in substitution for, any other rights to indemnification or contribution
that any such person may have had by contract or otherwise and the Vendor is
acting as agent and trustee for each Vendor Rep with respect to covenants of the
Purchaser under this Section.

    


    10.14           Non-Merger.  Except
as otherwise expressly provided in this Agreement, the covenants,
representations and warranties shall not merge on and shall survive the Closing.
Notwithstanding the Closing or any investigation made by or on behalf of any
Party, the covenants, representations and warranties shall continue in full
force and effect. Closing shall not prejudice any right of one Party against any
other Party in respect of anything done or omitted under this Agreement or in
respect of any right to damages or other remedies.

     

    10.15           Time of the Essence. Time is
of the essence in this Agreement.

    


    10.16           Mutual Understanding. This
Agreement is the result of mutual negotiations between the parties, and each
party agrees that no part of this Agreement shall be interpreted as against the
other party on the grounds that particular language was drafted by such
party.



    
      
         


      

      
         Page
21 of 26

        
          

        

      

      
         


      

    


    10.17           Language. The parties hereto
acknowledge that they have requested and are satisfied that this Agreement and
all related documents be drawn up in the English language. Les parties aux
présentes reconnaissent avoir requis que la présente entente et les documents
qui y sont relatifs soient rédigés en anglais.

    


    [Remainder
of page intentionally left blank.  Signature page
follows.]

    



    
      
         


      

      
        Page 22 of
26

        
          

        

      

      
         


      

    


    IN WITNESS WHEREOF, the
parties hereto have executed this Agreement on the date or dates indicated
below, effective as of the date first above written.

    


    


    
      	
              “Vendor”

            	 
      	
              “Purchaser”

            
	 	 	 
	 	 	 
	
              American Motive Power,
      Inc.

            	 
      	
              4107730
      CANaDA INC,.

            
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              By:

            	/s/
      John A. Martell  	 
      	
              By:

            	/s/
      Ralph Mikhail  
	 
      	
              John
      A. Martell, CEO

            	 
      	 
      	
              Ralph
      Mikhail

            
	 
      	 
      	 
      	 
      	 
      
	
              Date:

            	 12/4/09
      	 
      	
              Date:

            	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              For
      the purposes of Section 8.08 only:

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              MISCOR
      Group, Ltd.

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              By:

            	/s/
      John A. Martell  	 
      	 
      	 
      
	 
      	
              John
      A. Martell, CEO

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              Date:

            	 12/4/09
      	 
      	 
      	 
      


    


    
      
         


      

      
        Page 23 of
26

        
          

        

      

      
         


      

    


    Exhibit
“A”  AMP  Promissory Note

     

    AMP
RAIL SERVICES CANADA, ULC

    SENIOR
PROMISSORY NOTE

     

    
      	
              Amount:
      U.S. 
      $1,875,000

            	
              Date:  _________,
  20__

            


    

     

    FOR VALUE RECEIVED, the
undersigned, AMP RAIL SERVICES
CANADA, ULC (the “Borrower”), incorporated
under the laws of the Province of Alberta with its principal office and place of
business at 1830 Rue le Ber, Montreal Quebec, PROMISES TO PAY to or to the
order of AMERICAN MOTIVE POWER
INC (the “Lender”), at its offices at
1125 South Walnut Street, South Bend Indiana or such other place as the Lender
may designate, the principal amount of ONE MILLION EIGHT HUNDRED AND SEVENTY
FIVE THOUSAND DOLLARS (U.S.$1,875,000) in lawful money of the United
States ON DEMAND,
without interest.

     

    This Note
shall rank senior to the subordinated promissory note (the “Subordinated Note”) of the
Company dated of even date herewith.  No payments of principal or
interest shall be made on the Subordinated Note until this Note has been paid in
full.

     

    The
Borrower shall have the right and privilege of paying the whole or any portion
of the principal amount of this Note from time to time remaining unpaid and
outstanding at any time or times.

     

    The
Borrower and all endorsers of this Note waive presentment for payment and notice
of non-payment and agree and consent to all extensions or renewals of this Note
without notice.

     

    This Note
is binding upon Borrower and its successors and assigns and shall inure to the
benefit of Lender and its successors and assigns.  Lender shall not be
entitled to assign this Note and its rights and benefits hereunder in whole or
in part without the prior written consent of Borrower other than to 4107730
Canada Inc..  Borrower shall not be released from any of its
obligations under this Note upon any such assignment.

     

    This Note
shall be governed by and interpreted and enforced in accordance with the laws of
the Province of Quebec and the federal laws of Canada applicable
therein.

     

    IN WITNESS WHEREOF the
Borrower has executed this Note.

     

     

    
      	 	AMP
      RAIL SERVICES CANADA INC., ULC
	 	 	 
	 	 	 
	 	By:	 
	 	 	Authorized
      Signing Officer


    

     

     


    
      
         


      

      
        Page 24 of
26

        
          

        

      

      
         


      

    


    ASSIGNMENT

     

    The
Lender hereby assigns this promissory note to 4107730 Canada Inc. which accepts
same.

     

    
      	 
      	
              AMERICAN
      MOTIVE POWER INC.

            
	 
      	 
      	 
      
	 
      	
              By:

            	 
      
	 
      	 
      	 
      
	 
      	
              Authorized
      Signing Officer

            
	
              Accepted
      by:

            	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
              4107730
      CANADA INC.

            
	 
      	 
      	 
      
	 
      	
              By:

            	 
      
	 
      	 
      	 
      
	 
      	
              Authorized
      Signing Officer

            


    

    


     


    
      
         


      

      
        Page 25 of
26

        
          

        

      

      
         


      

    


    


     

    
      	
              Exhibit
      2.03(b)

            	
              Promissory
      Note

            
	 
      	 
      
	
              Exhibit
      2.04

            	
              Guarantee
      and Hypothec

            
	 
      	 
      
	
              Exhibit
      3.06

            	
              Required
      Consents

            
	 
      	 
      
	
              Exhibit
      3.16

            	
              Purchaser’s
      List of Material Contracts; Material Equipment

            
	 
      	 
      
	
              Exhibit
      4.06

            	
              Financing
      Commitment

            
	 
      	 
      
	
              Exhibit
      6.01(d)

            	
              Supply
      Agreement with HK Engine Components

            
	 
      	 
      
	
              Exhibit
      6.01(e)

            	
              Supply
      Agreement with Magnetech Industrial Services,
  Inc

            


    

    
 

     

     

    Page 26 of
26